Defending Collections Lawsuits on Credit Cards

Worried couple reading credit card bill sitting on a couch

It can happen to just about anyone. Things are going well, you’ve got a great job, so you feel confident putting a few extra items on a credit card. Before you know it, you have a hefty balance, but it’s okay, you’ll just pay it off over a few months. Then disaster strikes…you get laid off or sick and suddenly, you’re being hounded by credit card companies. Maybe you’ve even been served with a complaint. What’s your best course of action when you have to defend a collections lawsuit on a credit card debt?

The first thing you need to do is retain legal counsel. Don’t try to defend a lawsuit by yourself. It may seem like you are saving money, but it can cost you a lot more in the long run.

Next, collect all records you have related to the debt—any receipts, any records of payment. Your attorney will want as much accurate information as possible. In addition, request that the collection agency or its legal counsel produce all records they have. There’s a good chance that they have little to nothing, as most credit card collections are conducted by companies or people who have purchased the debts at a fraction of their face value. They may have little or no documentation other than the alleged amount of the debt.

If you haven’t hired an attorney yet and you’ve been served with a complaint, make certain you file a response to the complaint. The technical term for this is an “answer” to the complaint.

Send it to the court by certified mail and send a copy to the law firm and/or the collection agency that had you served. If you have been served with a complaint, though, it’s probably time to step back and look at the broad picture—is this a single problem or do you have far-reaching financial problems? Often, it’s better to attempt to negotiate a payment plan than to litigate. You may actually end up paying less through a negotiated settlement and you won’t have legal or court costs.

Contact Neuner & Ventura, LLP

We understand the stress, anxiety and confusion that can be associated with a potential bankruptcy filing. We offer a free initial consultation to every client. For an appointment, call Neuner & Ventura at 856-596-2828 or send us an e-mail. We do, however, reserve the right to charge a fee to review any work done by another attorney. Evening and weekend appointments are available upon request.

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